Zimbabwe finance minister pleads for diamond money

HARARE, Zimbabwe (AP) — Zimbabwe's finance minister said Monday he will ask President Robert Mugabe to order diamond mining companies to pay millions of dollars into the nation's treasury.

Finance Minister Tendai Biti told reporters he was losing patience with the companies' indifference in helping to fund a constitutional referendum on March 16 and elections in July.

Biti said at least $217 million is needed for both polls.

He said he had information that total diamond sales for 2012 amounted to $800 million but the state has received only $45 million so far, although the companies would have owed considerably more than that in taxes.

Biti said it was "criminal" that diamond mines and executives failed to submit their profits to the state. "I will be appealing to both the President and Prime Minister to make these companies pay. We are beginning to lose our patience," he said. "It is irresponsible and unpatriotic and a breach of our laws."

Diamond mining in eastern Zimbabwe has been mired in allegations of human rights abuses and illegal money laundering by Mugabe's loyalists.

Zimbabweans will be voting in a referendum for a new constitution which will pave way for elections to end a four-year-old coalition between long-time ruler Mugabe and former opposition leader Prime Minister Morgan Tsvangirai. The unwieldy power-sharing government was brokered by regional leaders in 2009 after violent and disputed elections in 2008.

Zimbabwe's eastern Marange diamond fields — one of the world's biggest diamond deposits — have been mined since 2006.

Biti and his former opposition party in the coalition have criticized what they call the militarization of Zimbabwe's diamond mining by Mugabe's loyalist police and military which have gone into partnership with secretive Chinese companies to exploit the stones.

"It is totally unacceptable that the country is struggling to raise money for the referendum and election when such money is coming from diamond sales," Biti said.

Mines Minister Obert Mpofu, a Mugabe-appointed minister, insists that Western economic sanctions have prevented the government from getting fair prices for the diamonds on the international market and forced some covert selling.

Zimbabwe is said to have the capacity to produce between 110 million to 160 million carats of diamonds annually, ranking it as one of the top five diamond producers by volume in the world.

An international diamond watchdog, Partnership Africa Canada alleged last year that at least $2 billion have been stolen by Mugabe's cronies from Zimbabwe's eastern diamond fields.

It said the vast earnings could have turned around Zimbabwe's economy, crippled by years of economic meltdown and political turmoil.

"We can't have a government which is indifferent to the costs of a referendum and elections," Biti said.

He said funding for Saturday's referendum has been raised from a giant local real estate and pension fund enterprise and other private interests as well as the sale of government treasury bills.

Zimbabweans are to cast their votes in the referendum at 9,000 voting stations countrywide Saturday. All political leaders have called for a 'Yes' vote from their supporters to accept a new constitution.

Crucial national elections are expected to be sometime in July, with Tsvangirai, 61, running against Mugabe, 89, in the presidential poll.